If you want to be able to enjoy the changing of the seasons each year. Retiring in Connecticut may be a dream come true for you. The state has a lot of offer residents. Which includes well-appointed cities, delightful small towns, and beautiful landscapes. Depending on how you’d like to spend your retirement. Connecticut may have everything you’d need to enjoy your golden years. However, you want to make sure you’re financially prepared for the location. If you’re going to retire well in Connecticut. Here’s what you need to know.
Cost of Living
When it comes to the cost of living. Connecticut is above the national average. In fact, with its score of 124.2, Connecticut is in the top ten most expensive states in the nation.
Housing and utility costs are particularly high in Connecticut. Coming in with scores of 138.3 and 134.9, respectively. However, none of it’s remaining score categories (groceries, transportation, and healthcare) come in at or below 100. Which means Connecticut is higher than the national average across the board.
On the housing front. The average home value in Connecticut is $259,855. That’s just slightly above the national average of $248,857. For rentals, the median price is $1,800 per month. Which is $150 more than the national average of $1,650.
Overall, living in Connecticut costs more essentially across the board. That means retirees need to have higher incomes in order to remain comfortable.
Connecticut does have state income taxes. Which isn’t ideal for retirees who may want to have a part-time job as a source of income. However, there is an exemption for Social Security benefits as long as your federal adjusted gross income (AGI) is below $75,000 if you’re filing single. Or under $100,000 if you’re married and filing jointly with your spouse.
It is important to note that retirement account withdrawals are subject to Connecticut state income tax, which come in between 3 and 6.99 percent depending on your tax bracket. Similarly, public and private pensions are taxed at the standard rate.
Further, Connecticut does have a sales tax. The statewide rate is 6.35 percent, with a handful of exceptions that have different rates (ranging from 1 to 9.35 percent). Unlike some other states, that rate is statewide, as local jurisdictions cannot impose more.
Additionally, there are property taxes that homeowners have to contend with, making Connecticut even more costly if you want to buy a house. However, individuals age 65 and older do qualify for property tax credits, reaching as high as $1,000 for individuals and $1,250 for married couples.
Part-Time Job Opportunities
There are part-time job opportunities for retirees in Connecticut usually. However, COVID-19 has dramatically altered the employment landscape. Widespread unemployment means many people are exploring job opportunities, which can make it difficult for anyone to find a new job.
Should the pandemic resolve, the part-time job picture may be brighter. However, until that occurs, retirees may face challenges in nearly any state.
Best Cities for Retirees in Connecticut
If you want to retire well in Connecticut, choosing the right city is essential. It ensures you have access to the right amenities and that your money will go as far as possible.
Greenwich is a popular option, thanks to the city’s high availability of recreation centers and doctor’s offices. Ridgefield, New Milford, and Westport are also strong contenders, bring a lot to the table and having a competitive cost of living when compared to the state average.
How Much Money You Need to Retire Well in Connecticut
Since Connecticut has a higher cost of living, you’ll likely need more money to retire well there than in some other states. While the city you choose does play a role in how far your cash goes, you may want to plan to have at least $78,730 available as yearly income. That way, you can handle all of your needs and have plenty for wants, ensuring you can enjoy your retirement with greater ease.
Do you have any tips that can help someone retire well in Connecticut? Share your thoughts in the comments below.
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